Let’s face it… not everyone was born to be a sales person. You have to feel super confident about money and every aspect of the sales process; otherwise, you’re a sitting duck and your bottom line will suffer.
For many years in my business, and even now sometimes with certain clients, I would do the work first and then bill afterwards.
This process allowed me to feel less pressured to be at the client’s beck and call; when a client prepays, I tend to feel constrained. While I know what’s expected of me, there’s a feeling that creeps in that I need to be available 24/7.
I constantly have to remind myself that it’s okay to be responsive and to take action — as long as it’s within the parameters of our business hours. (Confession: It took me a long time to feel comfortable with that.)
Also, I had to get okay with telling clients what a realistic timeline was for something to be done.
Should You Bill Now or Bill Later?
The problem I’ve found with the ~work now bill later method~ is that for my business, it was very inconsistent with regards to how much workload would be on my plate.
It was hard to set parameters because the work could just show up at any time. My clients would pop up with their list of tasks, and I’d have to fit it in somehow and make it work. And then at the end of the month, I would bill them.
What I’ve come to realize is that while it appeared that doing it that way felt okay in the sense of the “you owe me, I owe you” scenario, it actually didn’t feel good because it was very inconsistent in terms of knowing how much time was needed for each client.
Sometimes, I had 15 hours of billable time that I could invoice at the end of one month, but then another month, it would only be two or three. It created a difficult situation for me in terms of keeping my cash flow consistent. Plus, I never felt entirely comfortable taking on new projects as I wasn’t sure what my retainer clients would need in a given month.
From the client’s perspective, sometimes it feels uncomfortable to pay for time in advance because they’re not really sure what the time is going to be used for yet. If that’s the case, and they’re not really sure where the time’s gonna go, it’s because you don’t have a solid strategy in place.
This begs the question: If they don’t have an idea of what they’re gonna use the time for, why are they buying it to begin with?
[bctt tweet=”Always know where the money is going to go. #moneypath” username=”freshtakepro”]
Accounting for Time Spent
Often clients will want you to provide a time report when the month is over, and personally, I’m totally cool with that. I can then tell someone that based on our strategy for the quarter, it looks like they will need an average of X hours a month. At that time, I can offer a package that meets those needs.
Should they need extra hours, they can buy them. Conversely, if some of that time does not get used, I can offer to roll the time over.
As long as there’s a predefined set of tasks that you’re going to do, then there’s no reason why they should feel that they’re buying time that you’re not gonna use.
For me, if I’m doing tasks and there’s a timer attached to it, then I want to see those reports when I’m done. The time report helps validate that the time was spent appropriately, and it also keeps track of how long it really takes to complete tasks.
Plus, time tracking helps with understanding where delegation or outsourcing can happen and where you may be wasting precious time. For the client, it helps to see the time report because there’s a solid piece of paper that shows, “Hey, this is what I bought. These are the things that were accomplished,” and it gives them a solid idea of where that money went.
[bctt tweet=”Time IS money, so spend BOTH wisely! #moneypath” username=”freshtakepro”]
Changing Your Mindset
I know there are implementers who don’t want to give time reports and that, to me, is a cautionary yellow flag. Do they not want to show the client because they don’t want to show where the time goes? Or maybe they’ve built in a hefty margin to pad their bottom line?
Perhaps, it’s really no big deal at all, and they just feel like time reports are a way for clients to micromanage them.
There are ways where you can still give someone a time report without accounting for your work right down to the minute. You shouldn’t have to explain everything line by line.
Take a logo design, for example. You can have a line on the time report that says “Logo design – 30 minutes.” There is absolutely NO need to have it detailed down like “18 minutes setting up the Vector, layers, and colors.” You don’t have to go down that path, but offering a broad stroke does help them understand how much time things take, and keep the client’s expectations in check.
Accounting for time spent also helps with demonstrating value to the client. It makes a person feel that you’re solid, and it builds trust.
[bctt tweet=”Honest money conversations build respect and trust. #moneypath” username=”freshtakepro”]
Having the time tracked like this can also provide a little validation about your prices and time spent and provides the added bonus that should you happen to run into an issue with the client, you have a reference point to explain where and how things were executed.
I’ve now started to see that while sometimes it felt better for me to bill after the fact, it was just a money mindset issue I had to get over. I now see much more benefit from billing in advance. When there’s a clear strategy in place, we know exactly what we need to do, and it makes for a smooth working relationship.
What’s your relationship to money? Do you feel confident about your sales process and comfortable with your money path? Share your experience in the comments below!